The second mammoth soybean crop in two years will swell U.S. supply to its largest size in nine years, says the Agriculture Department in updated projections for this year’s crops. The soybean stockpile, forecast for 385 million bushels when this year’s crop is mature, is expected to grow by 12 percent, to 430 million bushels, by Sept. 1, 2016, despite record soybean exports, says the USDA. On the final day of its annual Outlook Forum, it projected a crop of 3.8 billion bushels, the second-largest on record and 4 percent smaller than 2014’s record-setter.
“Soybeans remain a favorable alternative to higher cost crops like cotton and corn for many producers, especially those in lower-yielding corn areas,” said the USDA. For that reason, the department projected plantings of 83.5 million acres of soybeans, down 200,000 acres from the record sowings of 2014.
A huge corn crop is expected – the third-largest ever at 13.595 billion bushels. The USDA says record-large corn consumption of 13.760 billion bushels, led by bigger exports and feed use, will reduce supplies swollen by back-to-back record crops in 2013 and 2014. By the time the 2016 crop is ready for harvest, the corn stockpile will be 8 percent smaller than when this year’s crop goes into the bin.
The USDA’s projected corn and soybean stocks are smaller than initially projected last fall. Nonetheless, supplies are ample and this year’s corn and soybeans will fetch lower prices than the 2014 crops. The department projected farm-gate prices of $3.50 for corn and $9 for soybeans. The corn price would be 15 cents a bushel lower than this marketing year and soybeans would be $1.20 lower. “Wheat prices are expected to remain under substantial pressure from large world supplies of wheat and corn,” said the USDA.
The first farm-based indication of this year’s crops will be the Prospective Plantings report on March 31. The USDA surveys more than 80,000 farm operators during the first two weeks of March on their crop plans. The margin of error in the plantings report in relatively small for corn and soybeans, the two most widely grown U.S. crops.